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Developed-Country Economic Growth Jumps, OECD Report Shows

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November 21, 2016

By Paul Hannon

The rate of economic growth in developed countries doubled in the three months to September, figures from the Organization for Economic Cooperation and Development showed Monday, an indication that the global economy may be set for a modest pickup.

The third-quarter rebound was led by the U.S. and Japan, while the U.K. and Germany slowed. Among members of the Group of Seven largest developed economies, the U.S. fared best, despite some uncertainty ahead of the Nov. 8 presidential elections.

The OECD said the combined gross domestic products of its 34 members--most of which are developed economies--grew by 0.6% from the previous three-month period, compared with just 0.3% in the second quarter. That marked the fastest rate of quarter-to-quarter growth since the first three months of 2015.

Compared with the same quarter of 2015, GDP was up 1.7%, with the U.K. growing most rapidly among G-7members, and Japan most slowly.

Before the release of the third quarter figures, the OECD had forecast that GDP in its members will rise by 1.8% in 2016, down from the 2.1% rate of expansion recorded in 2015.

For 2017, the OECD and other international bodies expect a modest acceleration in global economic growth, supported by a revival in large developing economies such as Brazil and Russia that have contracted over recent years.

But much will depend on the economic policies adopted by U.S. President-elect Donald Trump. Investors are anticipating a pickup in U.S. economic growth aided by increased spending on infrastructure projects and tax cuts. But during his campaign, Mr. Trump pledged to introduce new, higher tariffs on imports from China and Mexico, andreassess other trade relationships that he said placed U.S. workers at a disadvantage. If implemented, those measures would likely hurt growth in other parts of the world.